Canada to clamp down on crypto exchanges following QuadrigaCX case
The QuadrigaCX scandal was a landmark event that became a red flag for the entire cryptocurrency community in Canada. The sequels, however, are not over. Securities regulators in Canada are now preparing to clamp down on cryptocurrency exchanges that take custody of digital assets.
The Canadian Securities Administration issued a staff notice on January 16 that details how cryptocurrency exchanges will be treated. More specifically, the note marks the difference between those exchanges that take custody of their clients' assets and those that do not.
Custody exchanges will receive harsh treatment from the country's securities regulator. According to the document, which is also indicative, these exchanges will be subject to the derivatives traditional and safety regulations.
[amazon box="B077NS1H17"]Consequences of QuadrigaCX in Canada
In Canada, securities are regulated by different provinces and not by the federal government. That is why it is very likely that the country is working towards unified regulation. On the other hand, the notice also stipulates when those securities laws will not apply.
«In our view, a simple ledger entry does not constitute delivery, due to the user’s continued reliance and dependence on the Platform to eventually receive the crypto asset upon request. The terms of the transaction require that the entire amount of the crypto asset purchased from the Platform or the counterparty seller be immediately transferred to a wallet that is under the sole control of the user, and the transfer is immediately reflected on the Bitcoin blockchain.». Read the document.
Cryptos under the headlights
All of this takes place after the infamous scandal of exchange cryptocurrency exchange QuadrigaCX that saw $ 190 million of user funds blocked.
The above is not the first thing Canada has done towards the field, especially in terms of regulations. Last year, almost immediately after the scandal, the country proposed prohibit short selling of cryptocurrencies as well as margin trading.
In any case, the country seems to be more oriented towards digital assets. Recently, Reports began to circulate that the Royal Bank of Canada is looking to launch its own Bitcoin trading platform. It would supposedly allow the bank's clients to buy Bitcoin and invest in it.
